Dear Economist: Which was football’s biggest transfer fee?

At the time, Kaká’s transfer fee from AC Milan to Real Madrid was reported to be the largest in the world, clocking in at £57.5m (€67.2m). However, in terms of euros, Zinedine Zidane’s transfer from Juventus to Real Madrid in 2001 was the largest, at €76m (£46m). Given that both transfers happened solely in the eurozone, with no English clubs involved, how can we claim this is a world record transfer?
Ed Lewis, London

Dear Mr Lewis,

The fact that the pound was strong in 2001 and weak today does not justify the suggestion that Kaká’s transfer fee is larger than Zidane’s, so you are right to query the way this has been reported. But the problem goes deeper than you suggest. Even if both transfers had taken place in the UK, a 2001 pound is not the same as a 2009 pound.

I have before me an illustration of the so-called world transfer records, courtesy of the BBC. These start in 1905 with Common (£1,000), move through Jeppson (£52,000, 1952), Maradona (£5m, 1984) and others, to Ronaldo (£80m, 2009). But it is absurd to suggest that Ronaldo’s transfer fee was 16 times greater than Maradona’s or 80,000 times greater than Common’s.

According to www.measuringworth.com, £1,000 in 1905 is worth about £80,000 today if adjusted for retail price inflation, and about £425,000 today relative to average earnings. Maradona’s £5m transfer fee in 1984 is worth £12m or £17.5m today, by the same metrics. Cristiano Ronaldo’s transfer fee of £80m is titanic enough to need no flattering.

I am sure the press fail to make these adjustments because they want to be able to announce new records. In future, perhaps they should first convert all monetary sums into Zimbabwean dollars. Records would tumble daily.